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Franklin Delano Roosevelt and the New Deal

In 1932, Herbert Hoover was the U.S. president. In 1933, he was toast. Much of the country blamed Hoover for the Depression, although the groundwork for it had been laid long before he was elected in 1928. Hoover’s big mistake was that he kept saying things would get better if everyone was just a little patient — and things just got worse.

When the next presidential election came along, it was pretty clear that the Democrats could nominate a dead dog and still beat Hoover. Fortunately for the country, they passed up deceased canines and chose the governor of New York. His name was Franklin Delano Roosevelt, an appellation reduced in newspaper headlines and the popular parlance to “FDR.”

FDR's background

A distant cousin of Theodore Roosevelt and the only son of a wealthy railroad executive, FDR attended the best private schools and graduated from Harvard. Trained as a lawyer, Roosevelt served in the state legislature, became assistant secretary of the Navy, and had a boundless future. Then, in 1921, he was struck by polio and crippled.

But Roosevelt had an indomitable spirit. He was elected New York’s governor in 1928, earning a reputation as a reformer. The Democrats nominated him for the presidency in 1932 after some behind-the-scenes maneuvering by newspaper publisher William Randolph Hearst and business tycoon Joseph Kennedy. FDR campaigned on a “New Deal” platform and easily defeated Hoover.

Despite his aristocratic background, Roosevelt was wildly popular with the average guy, many of whom did not know he could walk only with leg braces and crutches. (News photographers and newsreel cameramen took care not to take shots of him in “awkward” poses.) But many conservatives and business leaders, who considered him a traitor to his class, hated him.

FDR may have been the perfect president for the time. He was friendly and approachable, and exuded sympathy and self-confidence. He knew how to compromise, and, like Lincoln and Washington, he knew how to get the best out of people. He was lucky — before taking office he narrowly escaped an assassin’s bullets while riding in a car with Chicago Mayor Anton Cermak in Miami (Cermak was killed). He wasn’t afraid to do something, even if it proved to be wrong: “Take a method,” he said, “and try it. If it fails, try another. But above all, do something.”

FDR's New Deal policies

Roosevelt heeded his own advice and did something. Supported by healthy Democratic majorities in Congress, FDR pushed through a dazzling array of programs (many of them best known by their initials) in his first 100 days in office. The products of the first 100 days (and in some cases a bit longer) included the

  • Emergency Banking Act. Three days after he took office, FDR closed all banks. Then, on March 9, he pushed through Congress a bill that reopened the banks under close supervision. The bill, which took all of eight hours to go through, also authorized the treasury to issue more currency.

  • Civilian Conservation Corps (CCC). This created 1,300 camps around the country to give young men new jobs (at $30 a month, with $22 sent home to their families) in conserving natural resources. By 1941, the CCC employed 2.5 million men, who planted more than 17 million trees and made improvements in scores of state and national parks.

  • Federal Emergency Relief Act (FERA). The FERA eventually provided a total of $500 million in aid to state and local governments.

  • Civic Works Administration (CWA). The CWA provided about 4 million jobs in building roads, airports, schools, sewer systems, and other civic projects.

  • Agricultural Adjustment Act (AAA). Basically, it paid farmers not to produce so much food. That bailed farmers out, at least a little, and increased farm prices to more profitable levels.

  • Homeowners Loan Act. This provided funds to help keep homeowners from losing their homes to mortgage foreclosures.

  • Tennessee Valley Authority Act (TVA). One of the most innovative of the New Deal programs, the TVA created an independent public agency that oversaw the development of dams and other projects in the Tennessee River Valley. The TVA covered 40,000 square miles in seven states. It built 16 dams, took over 5 more, and provided electric power to 40,000 families that previously had none. The TVA also supplied fertilizer, provided flood control and better river navigation, and reforested vast areas.

  • Truth in Securities Act. This act required new stocks and bonds offered for sale to be registered with the new Securities Exchange Commission (SEC) and required brokers to fully disclose all background information.

  • Glass-Stegall Banking Act. This act mandated that banks get out of the investment business and restricted use of bank money on stock speculation. It also created federal guarantees for personal bank accounts.

  • National Industrial Recovery Act (NIRA). This ambitious program was designed to get industries to cooperate in setting maximum hours, minimum wages, and price controls through an organization called the National Recovery Administration (NRA). The NIRA was declared unconstitutional by the Supreme Court in 1935 for giving too much power to the program’s non-government administrators.

  • Works Projects Administration (WPA). This organization created a host of federal projects that ranged from cleaning slums and providing electricity to rural areas to painting murals on the walls of public buildings and putting on plays for audiences that paid only what they could afford.

In 1935 Roosevelt added to his alphabet soup of programs by getting Congress to pass the Social Security Act, which began a sweeping federal system of unemployment insurance and retirement pensions paid for by both employers and employees through payroll taxes. In 1938, he signed the Fair Labor Standards Act, which created a national minimum wage of 25 cents per hour and a maximum workweek of 44 hours.

By the time the 1936 elections rolled around, things were looking up. Unemployment had dropped from 12 million to about 9 million. Average weekly earnings had increased from $17 to $22. So despite Republican predictions that the Democrats were creating a socialist state, FDR was easily reelected.

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